In recent weeks, much conversation has come up amongst Industrial's clients and staff on the topic of e-commerce transactions. Associations in Canada - whether national, provincial, or community-based - typically conduct a variety of e-commerce transactions on any given day. E-commerce, in simple terms is defined as: "commercial transactions conducted using the Internet." In other words, any transaction where your member enters their credit card into a website, their payment is processed, and you receive the funds (after paying transactional fees to your payment provider) is a form of e-commerce.
Types of Transactions
With our extensive experience with associations here in Canada, we see a variety of e-commerce transactions that may occur.
1) Membership Transactions
These are transactions that relate directly to your membership, and the annual lifecycle of the member. Typical membership transactions include:
- New member signing up and paying membership dues.
- Existing member renewing their membership.
- Existing member adding new services to their existing membership.
- Member purchasing add-on services, such as insurance, or journal subscriptions, that directly impact membership or occur during membership sign-up/renewal.
These transactions are typically handled by your Association Management System database (a.k.a. your Membership Database platform) or your website e-commerce solution. These are some of the most important e-commerce transactions that impact your organization, and ensuring the process is seamless and straightforward for your members is critical to conversions.
2) Registration Transactions
These transactions typically relate to events; more specifically two types of events: 1) your annual conference; and 2) professional development events. These events can range from simple to complex, and sometimes require specialized software. Examples include:
- Conference registration can be complex. Do you have multiple events within your conference with different price points? Can members pre-select attendance for concurrent sessions? Are there limits to the number of attendees that can come from one member organization? Do you need to facilitate the submission, peer review, and approval of abstract submissions?
- PD event registration can take two fundamentally different forms: 1) in-seat events; and 2) online events. In the case of in-seat events, you need to consider attendance management based on the size of space, and cut off registrations at a certain point. You need to manage tickets and access to the event, and potentially dietary considerations and other logistics. For online events such as Webinars, registration is simpler, with the end product being delivered via your webinar software of choice, such as Adobe Connect.
Event registration transactions can be handled by a variety of solutions. For in-seat events, organizations typically lean on 3rd party event platforms such as Cvent, Eventbrite, or enterprise-level solutions like EventsAIR. For online events, the e-commerce functionality provided by your website Content Management System (CMS) can typically do the job. If you're running an open source CMS such as Drupal or WordPress, there are a variety of plugins and modules that can support these type of e-commerce transactions.
3) Digital Product Purchases
Digital products are very common among associations that we work with. Often associations will sell access to digital products such as past webinar downloads, publications, or digital training material. Digital products are best handled using an e-commerce platform, tightly integrated with your website. Similiar to selling registrations for online events, this is best handled by your CMS solution such as Drupal or WordPress, or can be handled by best-in-class 3rd party e-commerce platforms such as Canada's own Shopify. Key here is a system that can effectively handle taxation and the delivery of digital good downloads post-purchase.
4) Physical Product Purchases
While not quite as common as digital product purchases, the ability to sell physical goods to members or customers is a requirement we often see with our association clients. Examples include print publications, corporate swag (promotional material), and other branded products. Physical product purchases require a system that can handle inventory management, taxation, and shipping logistics. Just like digital product purchases, you're best to lean on your website CMS, or a 3rd party e-commerce platform to handle the complexities of selling physical goods.
5) Ad/Posting Transactions
At many associations, a key revenue driver is the sale of ads on their website. Ads can take many forms, such as:
- Ad space (advertisements) by vendors or partners on your website or in your print-based publications.
- Job ads posted by member organizations or customers that want to promote their jobs to your membership.
- Classified ads by your members, vendors, or partners to advertise individual services or products to your membership.
Handling of ad-based transactions can require special software designed specifically to handle the task. For example, the posting of job ads can require specialized fields for data entry by the customer, approval processes, invoice generation, duration of posting, and extension of postings. We often see these transactions handled directly by website Content Management Systems, or through custom software applications developed specifically for the requirements.
6) Subscription Purchases
In the traditional sense, the most common subscription-based purchases provided by associations to their members is their monthly or quarterly Journal. Such Journals are typically provided in either print format, digital format, or both, with an annual subscription fee charged - typically on an annual basis. When handling journal or publication subscription during renewal, your membership database solution can typically handle the transaction.
However, more and more associations are looking at the possibility of expanding their subscription-based revenue beyond the traditional Journal. The concept of fee-for-service is not new, and associations are beginning to see the potential of subscription-based revenue to aide in revenue diversification. Such subscriptions may include:
- Access to a compendium of key data sets that can help members make timely decisions within their profession.
- Membership itself as a subscription, instead of an annual renewal.
- Access to a series of educational events or webinars on a recurring basis.
- Access to digital tools that can help members do their jobs, such as mobile apps, online networks, or databases.
The subscription model to service delivery is forward-thinking, and something that all Canadian associations should consider. The power of reducing to a smaller monthly or quarterly payments for delivery of timely services can have immense value for association leaders and members alike. There are a variety of technology solutions that can facilitate recurring subscription revenue, including traditional e-commerce platforms and membership data platforms.
7) Donation Transactions
If your association has a fundraising arm, donations are another key transaction. Donations are commonly sought at key touchpoints with members such as the annual renewal cycle or conference registration. Your membership database should be able to handle the collection of donation $'s at time of renewal and onboarding, provided that it has the ability to create receipts for tax purposes. For ad hoc donations by members, 3rd party services such as CanadaHelps.org have become the industry standard for fundraising transactions in Canada, and are highly recommended.
Across the various transaction types defined above, they have one thing in common: they facilitate the ability for a user to self-identify, select products or services, and proceed to checkout. In order to process a transaction online, each of these platforms require integration with an online payment gateway. A payment gateway is a service that can authorize credit card payments online: all e-commerce solutions require integration with a payment gateway in order to complete a credit card transaction.
Here in Canada, some of the most popular payment gateways are:
Moneris was created as a joint venture between BMO and RBC. If you bank with one of those two companies, you most likely are using Moneris for processing credit cards.
Beanstream is used by many companies for their payment processing, but most notably (here in Canada) it is white-labelled by TD Canada Trust as their online payment processing solution. If you bank with TD, you most likely are using Beanstream as your payment gateway.
One of the original services to facilitate online payments, PayPal remains a dominant player in the space. PayPal has a variety of payment processing services available, and we often come across it with our association clients.
For those of us that live in the world of technology, Stripe is the go-to payment processing gateway. Stripe takes a modern approach to payment processing, has a robust feature set, and is very developer-friendly, meaning it can integrate very nicely with most any software solution.
How do you choose the best payment gateway? There are many factors to consider, such as where you do your banking, who will give you the best transactional rate/fee structure, do you need to facilitate recurring transactions, and how closely you need to integrate it with other software.
Accessing Transactional Data
As outlined above, there are many different technology platforms that can provide e-commerce transactions for your organization and it is highly unlikely that any one platform will provide you with every possible type of transaction you need. This creates a challenge: if more than one platform is needed to process transactions, are they able to integrate with each other? Can they all integrate with my membership database so I can provide discounts to my members? If I want to report on purchases for any one member, do I need to download data from a variety of sources, integrate it into one spreadsheet, then run my reports?
Access to data is a key consideration when selecting the technology platforms that your association will use for e-commerce transactions. Knowing one platform is unlikely to be able to provide all the services you need, integration becomes a key driver in decision making. The evolution of the Internet - in particular web services and API's - has provided software developers with the ability to integrate desperate systems together. When evaluating software platforms for your organization, lead with the question: Does your platform have an API for integration with my membership database?
Here at Industrial, we are strong believers in the microservice model of software delivery. Microservices are, by definition, small software applications that do one thing very well, and are built to integrate with other like-minded software. Modern e-commerce platforms like Shopify take this approach, and its the same approach we are taking with Wicket, the modern, open-source member data platform for the association of the future.
If you'd like to learn more about e-commerce transactions, integration via API's, or the innovative Wicket member data platform, get in touch.